Samsung’s Performance
Samsung Electronics announced on April 29 that it recorded 8.49 trillion won (US$8.23 billion) in operating profits on a consolidated basis in the first quarter of this year. The amount is 3.31 percent less compared to the 8.78 trillion won (US$8.51 billion) of Q1, 2013 but 2.14 percent higher than the 8.31 trillion won (US$8.05 billion) of Q4 last year.
Quarterly sales reached 53.68 trillion won (US$52.04 billion) during the period, edging up 1.53 percent from Q1 of last year and declining by 9.45 percent when compared to Q4, 2013. The current net income increased by 3.74 percent quarter-on-quarter and 5.86 percent year-on-year to 7.57 trillion won (US$7.33 billion).
The figures announced on April 29 are final. The tentative amounts, made available on April 8, were 53 trillion won (US$51 billion) in sales and 8.4 trillion won (US$8.1 billion) in operating profits. The 25 local securities firms had estimated the turnover at, on average, 8.46 trillion won (US$8.2 billion).
Samsung Electronics’ business profits plunged no less than 18.3 percent quarter-on-quarter in Q4 last year to shock market participants. However, it has succeeded in dispelling their worries this time. Most of them appear to be relieved at the most recent business showings, though the profit is not as large as that of Q3, 2013 at 10.16 trillion won (US$9.8 billion).
The performance was led by its wireless device and memory semiconductor business units, even though the demand for its products was rather slow due to seasonal factors. By business unit, the IT and Mobile (IM) Division recorded business profits of 6.43 trillion won (US$6.23 billion) with its Galaxy series of handsets. The division’s profits had dipped below 5.5 trillion won (US$5.3 billion) in Q4 last year, but rose to well over 6 trillion won in the following quarter, close to the 6.51 trillion won (US$6.3 billion) posted in Q1, 2013. The Galaxy S4 and the Galaxy Note 3 enjoyed a lot of popularity along with mid-market models including the Galaxy Grand 2 and the Galaxy Ace 3.
In the meantime, the Device Solutions (DS) Division reached 1.87 trillion won (US$1.81 billion) in profits with the semiconductor arm’s profits amounting to 1.95 trillion won (US$1.89 billion), but the display business unit remaining 80 billion won (US$77.6 million) in the red due to the seasonal decline in panel demand and drop in sales price. The DRAM unit improved its profitability by means of the process conversion to the 20 nanometer scale.
The Consumer Electronics (CE) Division earned 190 billion won (US$184 million) during the same period. The size of the profits somewhat shrunk from the 650 billion won (US$630 million) of Q4 last year.
“Although the low season continues until the second quarter, the demand for memory semiconductors and display panels for new mobile products is likely to show upward movement with major sports events such as the Brazil World Cup,” said the company, adding, “Under the circumstances, we will maintain our performance in the IT sector while further improving our business figures in the memory and consumer electronics segments.”